Old Dominion University Old Dominion Unive sity Old Dominion University Old Dominion University Real Estate Center Real Estate Center Hampton Roads Real Estate Hampton Roads Real Estate Market Review and Forecast Market Review and Forecast 2004 Retail Market Overview 2004 Retail Market Overview Presented By Presented by: The Center for Real Estate H. Blount Hunter and Economic Development RETAIL SALES TREND RETAIL MARKET OVERVIEW 0.09 • 46.4 million SF GLA (shopping centers) 0.08 0.07 • 30.3 million SF Southside (65 percent) 0.06 Southside 0.05 Peninsula 0.04 Virginia • 16.1 million SF Peninsula (35 percent) 0.03 US 0.02 0.01 0 � Retail SF and population are generally “balanced” 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 2003 AVERAGE RENT LEASING DYNAMICS � 749,000 SF new construction $20.00 � 831,000 SF estimated absorption $18.00 $13.46 $13.18 $16.00 � Overall vacancy rate: 11.9 percent $14.00 $12.00 ↓ DOWN 0.5 percent from 2002 Southside $10.00 Peninsula ↓ DOWN 1.6 percent from 2001 $8.00 $6.00 � Average small shop asking rent: $13.32 $4.00 $2.00 ↑ UP $0.49 PSF from 2002 $0.00 ↑ UP $1.05 PSF from 2001 AVERAGE 1
RETAIL SUBMARKETS RETAIL PRODUCT TYPE • 24 retail submarkets Southside 12 – 6 regional malls 14.9 million SF 10 – 419,500 SF new construction 8 6 • 10 retail submarkets Peninsula MSA 4 – 2 regional malls 7.3 million SF 2 – 330,000 SF new construction 0 Neighborhood Community Regional Power Freestanding Specialty Festival Outlet VACANCY BY PRODUCT TYPE “BIG BOX” VACANCY � 3.5 million SF “Big Box” vacancy 18.00% 16.00% – 67 percent of total retail vacancy 14.00% 12.00% – Disproportionate problem on Peninsula 10.00% • 45 percent of “big box” vacancy is on Peninsula 8.00% • 77 percent of Peninsula’s vacancy is in “big boxes” 6.00% 4.00% – Reflects modest decline compared to 2002 2.00% but still suffering from sharp increases in 0.00% 2000 and 2001 Regional Neighborhood Community Power Freestanding Specialty Festival Outlet “SWEET SPOTS” NEW PLAYERS � “Sweet Spots” exist throughout the region: � Kohl’s � Dick’s Sporting Goods – Williamsburg and Route 17 corridor � A.C. Moore – Northern Newport News � Jared’s Jewelers � Bass Pro Shops – Coliseum Central � California Pizza � Shoe Carnival – Northern Suffolk Kitchen � Moe’s Southwest – Hilltop and Pembroke areas in Va. Beach � Cold Stone Grill Creamery – Victory Crossing in Portsmouth � P. F. Chang’s – Downtown Norfolk � The Sharper Image – Greenbrier and 664 corridor � K & G Superstore 2
EXPANDING RETAILERS NOTABLE SALES IN 2003 • Wal*Mart � Lynnhaven Mall sold for $256 million • Farm Fresh ($197 PSF) • Burlington Coat Factory • Home Depot – TWICE the combined sales price of $112 million for Greenbrier Mall and Military • Lowe’s Home Improvement Circle in 2002 • Pier 1 • Ross Dress for Less � Smaller centers sold for $9 - $100 PSF “WORD ON THE STREET” “WORD ON THE STREET” → The grocery store war isn’t over…it’s → There’s more interest in this market than entering a new phase with Wal*Mart just ever before, and by a broader range of beginning to flex its muscles retailers and restaurants → Out parcel sites are scarce but eagerly → Many “big box” vacancies reflect “wait and sought by many types of users see” attitudes by landlords who are not investing capital to re-demise large spaces → Retailers aren’t bashful in making for smaller tenants demands for tenant allowance or in putting pressure on rents “WORD ON THE STREET” “WORD ON THE STREET” → It remains difficult to convey local market → All eyes are on Williamsburg for its population nuances to out-of-town site selectors growth and quality of consumer base → Infill opportunities for existing retailers are not → This market’s orientation to “small investor being promoted by retail tenant representatives property owners” continues to surprise and beguile regional and national retailers → “Workhorse” retail areas such as Janaf and Coliseum are being overlooked despite strong → Finding new sites for retail development is sales and new investment tough, especially in Chesapeake 3
Old Dominion University Old Dominion University Thank you Hampton Roads Real Estate Hampton Roads Real Estate Market Review and Forecast Market Review and Forecast for your support of The Center for Real Estate and Economic Development . Presented by: The Center for Real Estate and Economic Development 4
Recommend
More recommend
